Food industry in Australia

Food Industry
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(April 30, 2012)
Food industry in Australia
The organic food industry is a wide business that supplies food to the consumers all over the world population. The food industry will always include the retail food and supply chain services. The retail and supply chain services segments are sensitive and are affected by six main factors. The six factors will include: food inflation or deflation, softness in national and local economies, increase in energy costs and commodity prices, changes in interest rates, the availability of favorable credit and trade terms and other economic conditions that affect spending or buying habits. The above factors affect the retail sales, the demand for products one is to distribute to the customers, the operating costs and other important aspects of the business (Dr. Estrada-Flores 2008).
Food prices will always affect the running of a business. It is the basis on what one is to make out the business. Basically the grain price will always have the greatest effect in the food industry. It will affect price of meats, poultry, eggs, and dairy products. This is because these items account for more than half of the at-home food dollar; price changes for these categories can significantly affect the consumer price index (CPI) (Gambone 2012). If there is a price increase then the CPI will be affected negatively and vice versa.
In Australia, organic food industry is growing at the rate of 20-30 percent per anum. This is also the trend in the entire globe. Organic farming and retailing has replaced other forms that previously existed in the market. The growth in organic food sector is boosted by high consumer demand. Certified organic operators have been increasing in Australia at the rate of 70 percent through the last 5 years. Organic shops exist in every suburb and in supermarkets across Australia (State government of Victoria, 2012).
The current global organic food system is highly fuel and transport-dependent. Thus the cost of the fuel will always play a big role in the pricing of the commodities. Fuels will certainly become less affordable as the prices are souring as days goes by, this will make the highly dependent agricultural production system less secure and food less affordable. It is advis...